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Europe: China stimulus boosts European shares

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European shares bounced on Tuesday after China signalled more stimulus measures to soften the blow from an ongoing tariff war with the United States, triggering relief in trade-sensitive tech, mining, and car stocks as some results also impressed.

[LONDON] European shares bounced on Tuesday after China signalled more stimulus measures to soften the blow from an ongoing tariff war with the United States, triggering relief in trade-sensitive tech, mining, and car stocks as some results also impressed.

The pan-European STOXX 600 was up 0.6 per cent by 0829 GMT, with the trade-sensitive DAX up 0.8 per cent and the FTSE 100 rising 0.5 per cent.

Sectors reliant on trade and exports to China, like tech, industrials, basic resources, and autos, were the top gainers.

The autos sector jumped 2.2 per cent to its highest since Dec 5 on the stimulus news and after a strong update from Peugeot maker PSA Group soothed investors' concerns about carmakers facing slowing demand in China.

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Shares in the carmaker climbed 2.3 per cent to their highest since mid-November after reporting record sales for 2018.

Staffing company Hays also shone after strong results which showed an 8 per cent rise in quarterly net fees, boosted by strong hiring in Germany, its biggest market.

M&A was a driver with Swedish telecoms company Millicom up 4.7 per cent after a bid from Liberty Latin America.

Kinnevik, the majority stakeholder in Millicom, rose 4 per cent among top STOXX gainers.

On the negative side, UK bookmakers Paddy Power Betfair , William Hill, GVC Holdings and 888 Holdings fell 1.7 to 3.2 per cent after the US Justice Department published an opinion which could further restrict online gambling.

Chocolate maker Lindt & Spruengli fell 3.1 per cent after reporting sales rose 5.1 per cent in 2018, in line with its "around 5 per cent" goal, but highlighted the market environment remained "very challenging".

And among mid-caps, shares in sub-prime lender Provident Financial plunged 20 per cent after it issued a profit warning, citing higher impairments at its credit card business Vanquis Bank.

REUTERS